When is Telecom Retail going to strip for us?

Forums › Spark New Zealand (including Skinny and BigPipe) › When is Telecom Retail going to strip for us?

chevrolux

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#92724 4-Nov-2011 20:02

When will we get Naked DSL? Yes, I know there are other providers but I am a Chorus contractor and get a discount. Also, unfortunately, Telecom are still the quickest at getting things to happen. But I am sick of paying for a land line we don't use!! Would love to hear what people know in terms of Telecom offering this service.

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#541319 4-Nov-2011 20:52

why would they? landline phones are a major part of their busines, but their home packages are competitive so that is what to consider here.

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#541328 4-Nov-2011 21:44

Once they separate they won't have any requirement to stick to the traditional service provider model me thinks

ptinson

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#541391 5-Nov-2011 09:02

What makes you think that?

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NonprayingMantis

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#541399 5-Nov-2011 09:22

Orcon no longer sells broadband without a phone component (yes technically Genius is 'naked' but they give you a phone and expect you to make calls)
Slingshot massively improved all it's broadband plans recently but didn't touch naked. their naked plan now looks like a waste of time
Vodafone only offer naked DSL at a good price when you have a mobile. so they get calling there.
Telstraclear don't offer naked DSL at all.

those three along with telecom are the main 4 ISPs,and none offer true standalone broadband at an attractive price. You have to ask why. My guess is that it is because broadband on it's own simply isn't very profitable.
so if that is the case,why would Telecom slash their main source of profit to chase customers who won't be making them any money

DonGould

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#541424 5-Nov-2011 11:31

NonprayingMantis:

Orcon no longer sells broadband without a phone component (yes technically Genius is 'naked' but they give you a phone and expect you to make calls)
Slingshot massively improved all it's broadband plans recently but didn't touch naked. their naked plan now looks like a waste of time
Vodafone only offer naked DSL at a good price when you have a mobile. so they get calling there.
Telstraclear don't offer naked DSL at all.

those three along with telecom are the main 4 ISPs,and none offer true standalone broadband at an attractive price. You have to ask why. My guess is that it is because broadband on it's own simply isn't very profitable.
so if that is the case,why would Telecom slash their main source of profit to chase customers who won't be making them any money

That's an interesting analysis... I don't agree with it all, but it's really interesting :) :) :)

The suggestion I'm picking up is that providers can see the customers are still making voice communications over the networks.

Let's consider this: Telstra - BB only $55/m + 2Talk VoIP - $11.50/m = $66.50

Now this is almost the same value as the deal that Telstra is now giving customers on the Telecom Wholesale network (See: Is this New Zealands biggest phone and broadband deal?)

The difference is that Telstra is missing out on ~18% of the APRU (which is now going to 2Talk).

I suspect that providers, like Telecom Retail, are looking at these issues very carefully.

In Telstra's case, they still have wires for the PSTN running to my house, they still have POTS ports in the local cabinets, now doing nothing.

So this sets a new value on those ports. They can power them up and not sell them (they have to keep them powered while they still have at least 1 customer on the node), or they can drop the price to market rates and sell the capacity.

The providers are understanding that people are still using voice services. Telecom and Telstra can both see this just by looking at the porting stats (I moved 5 numbers alone this week for 2 customers and I'm one guy who's not really doing anything much serious in the market at present, so what numbers are the serious guys doing?!).

Split business (a bit like MMP) isn't a problem if you have the products in the market you need. Telecom is ok while customers are still buying a voice service from them, but Telstra don't have a domestic voice product and you can't put a competing data product on their voice service.

Telecom are against the wall. Why build a VoIP solution when you have a perfectly good NEAX solution? Why do it when all that's going to happen is you're going to rob business of one business unit and move it to another? What's more, the new business unit will generate lower revenue, incur high start up costs, go head to head with mobile voice revenue and because of its size, have to be wholesaled as well as retailed.

The answer, of course, is also quite simple - because if they don't, then the competition will get a run on them that they won't be able to recover from, but they also need the competition to get well started on that run before the business case becomes visible to make the investment and we're not there yet.

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Zeon

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#541432 5-Nov-2011 12:13

Those providers who don't yet have a VOIP offering are not going to compete with FTTH. If Xnet, Slingshot or Orcon can provide a VOIP solution then they only need to pay Chorus for the fibre whereas Telstra, Telecom retail and the like will have to pay for both fibre for the internet and copper for the phones? I'd be moving more quickly on VOIP if I were them or they'll get left behind.

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chevrolux

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#541450 5-Nov-2011 14:09

Zeon: Those providers who don't yet have a VOIP offering are not going to compete with FTTH. If Xnet, Slingshot or Orcon can provide a VOIP solution then they only need to pay Chorus for the fibre whereas Telstra, Telecom retail and the like will have to pay for both fibre for the internet and copper for the phones? I'd be moving more quickly on VOIP if I were them or they'll get left behind.

That's exactly it! I can understand them not wanting to stop making people pay for POTS as it is money for jam. The NEAX's have been sitting in the exchanges doing as they should for years so I guess it is the old 'if it aint broke dont fix it' problem. But in terms of future proofing for continuing business they arent doing that. I think Orcon have hit the nail on the head with their genius product as it allows the user to plug a modem in and use a phone just like they would with POTS but uses voip technology.

I don't want to use a Telecom voip solution. We use Ctalk at work (who go through 2Talk) and get great deals from them. All I want to do is stop paying for a POTS service I dont use much.

Spyware

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#541453 5-Nov-2011 14:28

Zeon: Those providers who don't yet have a VOIP offering are not going to compete with FTTH. If Xnet, Slingshot or Orcon can provide a VOIP solution then they only need to pay Chorus for the fibre whereas Telstra, Telecom retail and the like will have to pay for both fibre for the internet and copper for the phones? I'd be moving more quickly on VOIP if I were them or they'll get left behind.

As fibre is rolled out the copper is being decommissioned along with the exchange switches. Will be all VoIP from 2020.

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oxnsox

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#541456 5-Nov-2011 14:49

ptinson: What makes you think that?

Because as a single entity Telecom has to optimise the use of it's own infrastructure/services where other ISP providers don't, and they're able to cherry pick. eg: use the copper to provide a DSL service but offer Voice components either via VOIP(Orcon) or Mobile (Vodafone), thus optimising revenue by charging voice services thru their own network and infrastructure.

Are these ISP's loss leading on DSL to get Voice revenue.... I have no idea, but I'm guessing they make more out of their own services than from renting the copper.

So why should Telecom stick with the model that kept them using copper for Voice when, as a new entity they'll want to increase traffic on the XT network that they own outright.

Copper will be a significant player for the foreseeable future because it goes to soo many customers already, but once it becomes a completely Chorus network, all providers can choose to use it or not..... Telecom have never really had that option.

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#541480 5-Nov-2011 17:21

chevrolux: I think Orcon have hit the nail on the head with their genius product as it allows the user to plug a modem in and use a phone just like they would with POTS but uses voip technology.

I have nothing against Genius but you can't compare it with a NEAX switch.

Genius along with all other DSL based VoIP solutions are best effort VoIP solutions carried over a best effort residential grade internet connection. There is no guaranteed QoS (EUBA 192 could be used to guarantee that), no guaranteed backup in case of a power failure, and in the case of some VoIP providers, no compliance with the 111 emergency services code. You're not comparing apples with apples.

Many people forget that Telecom had Govt agreed timeframes to migrate customers to VoIP, and while there are many different reasons why this didn't happen, both technical and political. Telecom understand VoIP and have a far bigger VoIP network than many of you would even realise. Their Broadsoft offering will be a serious thread to some of the other existing players in NZ.

RedJalapeno

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#541495 5-Nov-2011 18:09

Vodafone only offer naked DSL at a good price when you have a mobile. so they get calling there.

$85 for 60GB in redzone? That's pretty reasonable for current standards imo.

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NonprayingMantis

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#541507 5-Nov-2011 19:32

RedJalapeno:
Vodafone only offer naked DSL at a good price when you have a mobile. so they get calling there.

$85 for 60GB in redzone? That's pretty reasonable for current standards imo.

not really seeing as you can get 60GB for $90 with a landline in the red zone, so you are only saving $5 by choosing the 'naked' option, which also denies you all the free local calling. I doubt anyone would pick the $85 option for naked broadband.

ptinson

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#541776 6-Nov-2011 20:35

oxnsox:
ptinson: What makes you think that?

Because as a single entity Telecom has to optimise the use of it's own infrastructure/services where other ISP providers don't, and they're able to cherry pick. eg: use the copper to provide a DSL service but offer Voice components either via VOIP(Orcon) or Mobile (Vodafone), thus optimising revenue by charging voice services thru their own network and infrastructure.

Are these ISP's loss leading on DSL to get Voice revenue.... I have no idea, but I'm guessing they make more out of their own services than from renting the copper.

So why should Telecom stick with the model that kept them using copper for Voice when, as a new entity they'll want to increase traffic on the XT network that they own outright.

Copper will be a significant player for the foreseeable future because it goes to soo many customers already, but once it becomes a completely Chorus network, all providers can choose to use it or not..... Telecom have never really had that option.

I would say that driving better integration with the mobile network and broadband packages is very likely, its less likely that you would see Naked plans from Telecom.
I would not use a term like copper to denote PSTN services. Most ISPs's still use the copper to deliver services, just not always Telecoms wholesale voice services.

I think a lot depends on what ends up where under the new separation plans.

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#541796 6-Nov-2011 21:19

I have put the question forward to several ISP owners & senior network technicians in ISPs.

All give the same answer.

There just isnt alot of money to be made in nDSL.

So. Why promote packages that do not yeild good return ?

The exceptions for the likes of Vodafone with their nDSL. They make up the profit via other means in the plans terms and conditions. (Something to do with mobile phones I believe ?)

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DonGould

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#541802 6-Nov-2011 21:28

sbiddle: I have nothing against Genius but you can't compare it with a NEAX switch.

I agree.

2 pairs into most homes, a full array of smart phone services could be provisioned and all had for less then $20 a month. However, does anyone ever thing we'll see that sort of value from a NEAX box?

sbiddle: no compliance with the 111 emergency services code. You're not comparing apples with apples.

Totally agree there as well.

There will need to be a mass migration to small VoIP providers and a child die before the 111 message gets any traction.

sbiddle: Telecom understand VoIP and have a far bigger VoIP network than many of you would even realise.

I really really really doubt that.

I think most people here are smart enough to think that Telecom will be all over VoIP.

sbiddle: Their Broadsoft offering will be a serious thread to some of the other existing players in NZ.

I don't doubt that for a second. I'm sure that once the playing field is right, they'll turn on their offerings and we'll suddenly see Telecom giving homes 2, 3 or 4 concurrent calls for the cost of the hardware and bundled if you take a mobile offering.

I can see them driving back hard as soon as the existing players get enough traction to drive against.

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